Fairfax 'uninterested' in APN stake

8:30 AM Tuesday Nov 25, 2008

Fairfax Media has ruled out buying the big chunk of APN News & Media, owner of The New Zealand Herald, on the market.

Irish media company Independent News & Media, led by chief executive Sir Tony O'Reilly, said it was carrying out a strategic review of its 39.1 per cent holding in APN, following a number of unsolicited expressions of interest in the stake.

As well as the Herald, APN publishes the Listener, a range of regional newspapers in this country and Australia, as well as being half owner of NewstalkZB stable The Radio Network.

Today Fairfax newspaper The Dominion Post quoted Fairfax chief executive David Kirk saying: "We don't have any intentions with APN and we won't be part of the (sale) process."

Mr Kirk was in Wellington to speak to clients of sharebrokers First NZ Capital.

"There were no assets (in APN) that we were particularly seeking," he said. He ruled out Fairfax buying The New Zealand Herald alone should it be sold in a break-up of APN.

Fairfax wanted to retain an investment grade rating and spare cash would go to pay debt as a priority, Mr Kirk said.

With such a low share price at present, Fairfax would not be "remotely interested in raising equity for an acquisition", Mr Kirk said.

Fairfax Media's shares traded at A$1.33 ($1.59) yesterday, down from about A$4.50 at the start of the year.

Earlier this month Standard & Poor's Ratings Services warned that Fairfax's leverage was at the high end of expectations for its BBB minus rating and there was "no tolerance within the rating for further heavily debt-funded acquisitions, particularly as advertising markets head into a more difficult period in the economic cycle".

- NZPA

* In New Zealand, APN owns The New Zealand Herald, several provincial newspapers, magazines including the New Zealand Listener, the nzherald.co.nz website and 50 per cent of the Radio Network.